TUTORIAL 1 CPA is a common accounting certification. A college offers CPA classes for companies at the premises of the companies. This is convenient for the personnel of the companies. A certain bank has 50 employees at the level of associate, manager and senior manager, assistant director who consider taking the CPA classes if they are offered at the bank's premises. The accounting personnel at the level of director and above already have a CPA. The utility of the CPA class for employees are not the same. - - An assistant director requires a CPA to be promoted to be a director so the utility of the CPA class is high for him/her. Associates can be promoted all the way up to an assistant director over time without a CPA so the utility of the CPA class is low for them. The college estimates the utility of the class to range uniformly over $0-$2500 for the employees. 1. Using the number of employees interested in CPA and its utility estimate, find the price- response function. 2. Find the revenue-maximizing price. 3. If the college charges $1250 per employee, how many bank employees would take the CPA class? 4. How much revenue the college makes with the price of $1250? 5. For the college, the cost of offering class to 25 or to 30 people is identical. Compute the revenue the college makes with the price of $1000? 6. To obtain more than the revenue of $31,250 and to enroll 30 people, the college offers a volume discounting scheme: Each of the first 25 people pay $1250 Each additional person pays $1000. Calculate the revenue the college makes with the volume discounting.